The application period for the reduction in value added tax (''VAT'') and withholding tax on real estate rentals has been extended for three months to be valid from 1 June 2021 by Presidential Decree published in the Official Gazette on 2 June 2021. You can reach the decree here. (Available in Turkish only).
As a result of the decision, which provides an extension to the temporary reduction in VAT and withholding tax on real estate rentals until 31 July 2021 due to the economic damage caused by Covid-19, several services such as passenger transportation, cultural activities and weddings have been affected.
Accordingly:
- The reduction in withholding tax on rental fees, which was previously reduced from 20% to 10%, has been extended for an additional three months.
- VAT rates on workplace rents have been reduced from 18% to 8% until 31 July 2021.
- VAT rates on accommodation and food and beverage services have been reduced from 8% to 1% for the period between 1 June 2021 and 31 July 2021.
- The entertainment tax rate of 10% collected from cinema tickets has been reduced to 0%.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.